From the SMH:
Bears have had a field day the past several months now, pointing to the prospects of a surge in gas exports from North America undercutting the economics of the local projects being developed in both Queensland and off Western Australia.
This correspondent has long felt the fears were overblown.
Now, it seems at least one of the two projects proposed for the US north west, in Oregon, has hit problems, with local government officials denying an application from the Oregon LNG and Oregon Pipeline Co’s application for a proposed LNG.
“The ruling …highlights the important issue that greenfield US LNG export proposals face materially higher commercial and social hurdles than brownfield proposals,” JP Morgan told clients in a note this morning.
“US LNG exports will not have a meaningful impact on the oil linked pricing dynamic that underwrites current and future Australian based LNG projects.”
So far four US-LNG projects have received part of the government approvals needed to proceed, and all are brownfields projects, which have significant economic advantages over greenfield proposals.
There are as many as 14 greenfield proposals which will have higher operating costs along with prospects of a slow or impossibly difficult regulatory process due to local opposition.
Potentially this is good news for the likes of BHP, Woodside, Santos, Origin et al.
Jeez. How many US terminals have been approved recently? Four plus another in Canada. How many have been rejected recently? One. How many are on the drawing board? 20 plus another five in Canada. How many Australian projects have been approved? None. Has Australia signed any major LNG off take deals lately. No. The one deal we have signed for Wheatstone was confidential. It would be a brave assumption to conclude that that was because it was oil-linked.
There are no bears running wild over Australian LNG, only North American projects.